Global Arab Network | Egypt injects millions of US dollars to support pound

Translate this article to your language:

GANPublications

e-Publications

Add Site to Favorites

Add Page to Favorites

Make Homepage

Share This Page

RSS Feed

--------------------------------------------------------------------------------------------------------------------
| |

Egypt injects millions of US dollars to support pound

Tuesday, 08 February 2011 23:50

Egypt (Cairo) - The Central Bank of Egypt (CBE) was forced on Tuesday to wade into the currency market to stop the Egyptian pound’s decline against the dollar and injected a large amount of US dollars to the exchange market for the first time in two years in a bid to stop the slide of the local currency.

The move follows confirmed reports on heated speculations on the money market since early today, CBE's Deputy Governor Hesham Ramez told Egypt's state-run Middle East News Agency (MENA). "The move aims to offset the increasing demand on the US dollar which could lead to great losses for the Egyptian pound (LE)," he explained.

"The bank is ready to adopt further immediate measures at any time when need be," Ramez affirmed, noting that the bank keeps a close watch on the money market. Regarding CBE's foreign exchange reserves, the senior official said the bank has some USD 36 billion that enable embarking on immediate and orderly interference in the market at any time. The measure helped reverse the recent downward trend of the LE against the greenback and regain EL 0.09.

The US dollar retreated from LE 5.96 to LE 87 on Tuesday. The banks and exchange companies in Egypt resumed operation on Sunday after more than a week of closure due to the ongoing unrest. Even as the country remains wracked by political uncertainty, the currency strengthened by its biggest daily margin since November on Tuesday after the central bank intervened to buy pounds. "We saw excessive speculative activity so we intervened to stabilize the market," Hisham Ramez, deputy central bank governor, told Bloomberg.

He declined to provide further details. The pound was up 1.3% to 5.878 against the US currency mid-afternoon in Cairo on Tuesday. In the previous session it fell 1.6%, hitting a new six-year low as foreign investors unnerved by days of violence and uncertainty continued to pull capital out of the country. (MENA)

Global Arab Network

< Prev		Next >

Add comment

The opinions of the authors in articles published are theirs alone and do not necessarily reflect the views of Global Arab Network
------------------------------------------------------------------------------
Published comments are the opinions of private individuals and do not reflect the views of Global Arab Network